Re: Wrekin Construction.
Posted: Fri Mar 13, 2009 10:44 pm
Sadly I've read reports that Ernst & Young are not looking to sell Wrekin as a going concern and are going to 'wind-down' the business, having made 400 members of staff redundant retaining 72 to assist with winding down the company.
I read one report that Wrekin's chairman (and owner) David Unwin personally telephoned creditors to let them know Wrekin was about to be in serious trouble. However reports have surfaced raising questions about his acquisition of Wrekin and the finances of his Tamar Group Ltd which bought Wrekin Group PLC, the parent of Wrekin Construction Company LTD.
About two years ago Wrekin were in difficulties after the disastrous expand-at-all-cost policy by the former owners (the Frain family)and David Unwin reportedly bought an 85% majority stake through his London & Middle Eastern Group Ltd business (for a nominal sum) and subsequently acquiring the remaining shares for £750k after he'd reportedly invested £11m by Wrekin issuing new shares to stablise its finances.
However its come to light that the £11m investment actually saw Wrekin take ownership of a Ruby known as ''The Gem of Tanzania'', which Wrekin got by issuing new shares and handing them over in exchange. Apparently the stone has a ''fair value of £11m''. Apparently Wrekin's accounts went from a net liability of £8m to net assets of £6m after it acquired the Ruby.
Contract Journal report that:
''Its validity and worth came guaranteed, according to Wrekin, by a professional valuer at the Instituto Gemmologico Italiano, based in Valenza, Italy, on 31 August 2007''.
Apparently its in a safe deposit box in the UK but Peter GReenwood has never seen it!
See:
http://www.contractjournal.com/Articles ... stone.html
The Birmingham Post are reporting the same story, also adding that ''Accounts filed at Companies House say the Gem of Tanzania was bought “in exchange for the issue of £11,000,000 2 per cent cumulative redeemable preference shares.” It says the gem was valued by “a professional valuer at the Instituto[sic] Gemmologico Italiano, based in Valenza, Italy, on August 31, 2007.”
However, the Istituto Gemmologico Italiano, a government-recognised Italian institution, said it had no records of the “Gem of Tanzania”, was not open in August, and did not do any valuations at its site in Valenza, which was solely for teaching''.
and Ernst & Young refused to comment about the “Gem of Tanzania”, but said it had identified some other financial issues.
The spokesman said: “While the Administrator’s investigations are at an early stage, there are a number of issues which have already been identified.
“Over recent months, credit insurance for Wrekin Construction has been significantly reduced or withdrawn completely.
“Amounts due to the Crown in respect of VAT and PAYE appear to exceed £3.5m. Amounts believed to be due to Wrekin Construction in respect of government contracts exceed £2m.
“Over the last 12 months Wrekin Group has invested approximately £2m in relation to land for redevelopment and the acquisition of two businesses – Toft Johnson Construction and Watson Dallas.
“At Appointment, Wrekin Construction was the subject of five winding up petitions and approximately 40 County Court Judgments.
http://www.birminghampost.net/birmingha ... -23133971/
It certainly raises a lot of questions?
I read one report that Wrekin's chairman (and owner) David Unwin personally telephoned creditors to let them know Wrekin was about to be in serious trouble. However reports have surfaced raising questions about his acquisition of Wrekin and the finances of his Tamar Group Ltd which bought Wrekin Group PLC, the parent of Wrekin Construction Company LTD.
About two years ago Wrekin were in difficulties after the disastrous expand-at-all-cost policy by the former owners (the Frain family)and David Unwin reportedly bought an 85% majority stake through his London & Middle Eastern Group Ltd business (for a nominal sum) and subsequently acquiring the remaining shares for £750k after he'd reportedly invested £11m by Wrekin issuing new shares to stablise its finances.
However its come to light that the £11m investment actually saw Wrekin take ownership of a Ruby known as ''The Gem of Tanzania'', which Wrekin got by issuing new shares and handing them over in exchange. Apparently the stone has a ''fair value of £11m''. Apparently Wrekin's accounts went from a net liability of £8m to net assets of £6m after it acquired the Ruby.
Contract Journal report that:
''Its validity and worth came guaranteed, according to Wrekin, by a professional valuer at the Instituto Gemmologico Italiano, based in Valenza, Italy, on 31 August 2007''.
Apparently its in a safe deposit box in the UK but Peter GReenwood has never seen it!
See:
http://www.contractjournal.com/Articles ... stone.html
The Birmingham Post are reporting the same story, also adding that ''Accounts filed at Companies House say the Gem of Tanzania was bought “in exchange for the issue of £11,000,000 2 per cent cumulative redeemable preference shares.” It says the gem was valued by “a professional valuer at the Instituto[sic] Gemmologico Italiano, based in Valenza, Italy, on August 31, 2007.”
However, the Istituto Gemmologico Italiano, a government-recognised Italian institution, said it had no records of the “Gem of Tanzania”, was not open in August, and did not do any valuations at its site in Valenza, which was solely for teaching''.
and Ernst & Young refused to comment about the “Gem of Tanzania”, but said it had identified some other financial issues.
The spokesman said: “While the Administrator’s investigations are at an early stage, there are a number of issues which have already been identified.
“Over recent months, credit insurance for Wrekin Construction has been significantly reduced or withdrawn completely.
“Amounts due to the Crown in respect of VAT and PAYE appear to exceed £3.5m. Amounts believed to be due to Wrekin Construction in respect of government contracts exceed £2m.
“Over the last 12 months Wrekin Group has invested approximately £2m in relation to land for redevelopment and the acquisition of two businesses – Toft Johnson Construction and Watson Dallas.
“At Appointment, Wrekin Construction was the subject of five winding up petitions and approximately 40 County Court Judgments.
http://www.birminghampost.net/birmingha ... -23133971/
It certainly raises a lot of questions?